U.S. data center development is being repriced around one increasingly scarce commodity: projects that already have permits, power arrangements and construction underway. A post-election shift in several major development states, combined with local votes to restrict new facilities, has raised the value of deliverable capacity while putting later-stage proposals under greater pressure.
A Nov. 4 North America credit research note from JPMorgan said Democrats won control of both chambers of Congress and governor's races in Texas, Georgia, New Mexico and Nevada. The bank also cited Ballotpedia data indicating that 42 of 45 local ballot measures targeting data center development had either passed or were leaning toward passage, with two outcomes pending.
The result is a more difficult environment for the projects expected to supply computing capacity in 2028 and 2029. Developers without final permits, financing or construction progress now face a higher risk that local approvals, utility interconnection processes and political opposition will slow their schedules. In credit markets, that can widen the gap between an operating facility and a proposal backed mainly by land, projected power access and future customer demand.
Permitted sites gain an advantage
JPMorgan said the market's focus has moved from the scale of planned expansion toward permitting certainty, available electricity and construction milestones. One trader cited in the note described a change from paying premiums for investment-grade leases to paying premiums for completed assets.
That distinction affects more than data center owners. AI and high-performance-computing customers need facilities that can host dense GPU clusters, while utilities need years to add transmission lines, substations and generation. A site that has already cleared regulatory hurdles can offer a clearer path to revenue than a larger proposal awaiting local votes or grid approvals.
The bank did not expect permanent, statewide bans to become the standard response. Yet temporary pauses, more demanding utility-cost rules and voter-approval requirements can alter a project's economics even when development remains legally possible. Delays increase carrying costs, complicate financing and may leave developers unable to meet contracted delivery dates.
Local measures were concentrated in the Midwest, according to JPMorgan's review of Ballotpedia figures. Ohio had 20 measures, more than any other state, followed by Illinois and Maine. The restrictions ranged from caps on power consumption measured in megawatts to direct bans and requirements for local voter approval.
Harwood, North Dakota, was the sole measure reported as having failed, while two results remained pending, according to the bank's note.
New governors backed tighter reviews
The political proposals cited by JPMorgan point to more scrutiny of how data centers affect electricity prices, tax incentives and local infrastructure.
In Texas, Governor-elect Gina Hinojosa campaigned for an immediate pause on new data centers, greater local decision-making authority, a rate freeze and tighter review of infrastructure that could raise household power costs. Texas has become one of the largest centers for data center construction and carries an outsized share of high-yield project-finance exposure.
Georgia Governor-elect Keisha Lance Bottoms had supported a development pause of one to six months or longer to assess long-term effects, according to the note. Senator Jon Ossoff had backed a full pause and an investigation into statewide data center growth.
In New Mexico, Governor-elect Deb Haaland's platform called for pausing new large projects until regulators establish guardrails. Nevada's incoming administration was described as considering a pause on data center tax incentives, wage and benefit standards, and requirements that developers bear power-cost increases linked to their projects.
Ohio's Acton supported a conditional pause that would require developers to cover all utility costs, use union labor and disclose more operating information. These policies would not necessarily halt every project, but they would make the cost and timetable of new capacity less predictable.
Texas projects face the sharpest credit questions
Texas is particularly exposed because it accounts for about 27% of capacity already financed through the high-yield data center project-finance market, JPMorgan said. Among publicly listed high-yield builders covered by the bank, roughly 78% of planned pipeline capacity is located in Texas, primarily involving Cipher and Galaxy.
That concentration makes the state's permitting and power policies central to credit assessments of companies developing computing infrastructure. Unfunded projects or facilities that have not secured interconnection agreements could face steeper valuation discounts if local and state reviews lengthen.
JPMorgan said the greatest risk falls on projects expected to receive power in 2028 and 2029. They could be delayed and, in more severe circumstances, canceled. Financing pipelines that have not yet closed may also become harder to fund, since lenders generally place a higher value on projects with documented rights to power and clearer construction schedules.
Existing projects are less exposed. JPMorgan said Vistra's Meta-related 2.6-gigawatt project across Ohio and Pennsylvania is moving through development and involves nuclear assets. Georgia Power's OpenAI-related 3.2-gigawatt project has been approved by the Georgia Public Service Commission and is expected to begin construction by the end of 2026, according to the note.
American Electric Power's Texas utility has also increased its already-approved data center development tally to 1.6 gigawatts, JPMorgan said. Those examples show why construction status is becoming a more consequential dividing line than headline pipeline size.
Utilities and neocloud operators face delivery risk
The consequences extend to power producers, utilities and so-called neocloud companies that lease GPU capacity to AI developers. Delayed facilities can postpone the point at which a customer begins paying for contracted computing capacity, potentially shifting revenue recognition and infrastructure spending.
JPMorgan listed CRWV's U.S. data center footprint as leased or planned across North Dakota, Illinois, Georgia, Texas, North Carolina, Oklahoma, Virginia and New York, with additional planned sites in Pennsylvania and New Jersey. The company also has international projects in the United Kingdom, Denmark, Indonesia, India and Canada, according to the bank.
Power-demand forecasts would likely feel the effects first. Independent power producers with exposure to Texas, Ohio, Pennsylvania and Georgia could see near-term pressure if project schedules slip. Bridge-power providers and behind-the-meter generation companies may be more immediately affected because their business depends on supplying temporary electricity during construction or before permanent grid connections are available.
Regulated utilities appear less directly exposed, JPMorgan said, although data center demand had supported earnings-per-share growth expectations of 6% to 9% for some companies. Reduced data center capital spending could also ease balance-sheet pressure, even as utility investment is still expected to rise through at least 2030.
The bank expects 2027 capital plans to remain relatively stable because much of that spending is tied to projects already under way. The greater uncertainty sits in 2028 and beyond, when projects now waiting for approvals and financing would need to move into full construction.
Louisiana and North Dakota could attract a larger share of development if they offer a more predictable approval environment, JPMorgan said. International sites may also receive greater attention from developers seeking alternatives to increasingly contested U.S. markets. For data center operators, crypto miners and compute buyers competing for power-intensive facilities, the practical premium is increasingly attached to capacity that can be delivered rather than capacity that exists only on a development map.
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